Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Foundations Foundations of Controlof Control

FOM12-1

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Learning OutcomesLearning Outcomes• Define control

• Describe three approaches to control

• Explain why control is important

• Describe the control process

• Distinguish among the three types of control

• Describe the qualities of an effective control system

FOM12-2

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Learning OutcomesLearning Outcomes(continued)(continued)

• Identify contingency factors in the control process

• Explain how controls can become dysfunctional

• Describe how national differences affect the control process

• Identify the ethical issues in employee monitoring

FOM12-3

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

ControlControl

Process of monitoring activities to ensure that what is being

accomplished matches plans and corrects significant

deviations

FOM12-4

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Planning-Planning-ControllingControlling

LinkageLinkage

PlanningPlanning

OrganizingOrganizingLeadingLeading

ControllingControlling

FOM12-5

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Purpose of ControlsPurpose of Controls• Measuring PerformanceMeasuring Performance

• Comparing to StandardsComparing to Standards

• Taking Corrective ActionTaking Corrective Action

Goals and Goals and

ObjectivesObjectives

OrganizationalOrganizational

DivisionalDivisional

DepartmentalDepartmental

IndividualIndividual

FOM12-6

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Three ApproachesThree Approachesto Control Systemsto Control Systems

MarketMarketControlControl

ClanClanControlControl

BureaucraticBureaucraticControlControl

FOM12-7

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

The Control ProcessThe Control Process

IdentifyCauses

CorrectPerformance

VarianceAcceptable?

ReviseStandard

StandardAttained?

StandardAcceptable?

Yes

Yes

Yes

No

No

No

ComparePerformanceto Standard

MeasurePerformance

Objectives

Standard

Do Nothing

Do Nothing

FOM12-8

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

How Do Managers How Do Managers Measure?Measure?

• Personal observations

• Statistical reports• Oral reports• Written reports

FOM12-9

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

InformationInformation

PeoplePeopleFinancesFinances

OperationsOperations

What ManagersWhat ManagersMeasureMeasure

FOM12-10

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Discrepancies Between Goals and PerformanceDiscrepancies Between Goals and Performance

AcceptableAcceptableUpper LimitUpper Limit

StandardStandard

AcceptableAcceptableLower LimitLower Limit

AcceptableAcceptableRange ofRange ofVariationVariation

t t+1 t+2 t+3 t+4 t+5t t+1 t+2 t+3 t+4 t+5

FOM12-11

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

CanuckBrew’s Sales for JulyCanuckBrew’s Sales for July(in hundreds of cases)(in hundreds of cases)

Propeller

Big Rock Ale

Okanagan Spring

Garrison

Oland’s Export

McAuslan’s

Granville Island

Unibroue’s

Nelson After Dark

Total Cases

1,075

630

800

620

540

160

225

80

170

4,300

913

634

912

622

672

140

220

65

286

4,464

(162)

4

112

2

132

(20)

(5)

(15)

116

164

Brand Standard Actual Over (Under)

FOM12-12

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Do NothingDo Nothing

TakingTakingManagerialManagerial

ActionAction

Immediate/BasicImmediate/BasicCorrectiveCorrective

ActionAction

ReviseRevisethe Standardthe Standard

FOM12-13

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

InputInput ProcessesProcesses OutputOutput

Three Types of ControlThree Types of Control

FeedforwardFeedforwardControlControl

Anticipates Anticipates problemsproblems

ConcurrentConcurrentControlControl

Corrects problemsCorrects problemsas they happenas they happen

FeedbackFeedbackControlControl

Corrects problemsCorrects problemsafter they occurafter they occur

FOM12-14

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Feedback ControlFeedback Control

• Meaningful information

• Enhance employee motivation

FOM12-15

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Qualities of an Effective Qualities of an Effective Control SystemControl System

• Accurate

• Timely

• Economical

• Flexible

• Understandable

FOM12-16

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Qualities of an Effective Qualities of an Effective Control System (continued)Control System (continued)

• Reasonable

• Emphasis on exceptions

• Strategic

• Multiple criteria

• Corrective action

FOM12-17

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Adjusting ControlsAdjusting Controlsfor National for National DifferencesDifferences

TechnologyTechnologyand theand the

ComparabilityComparabilityof Dataof Data

DistanceDistanceand theand the

Formality Formality of Controlsof Controls

FOM12-19

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

FOM12-21

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Invasion of PrivacyInvasion of Privacy

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Employee MonitoringEmployee Monitoring

FOM12-22

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

E-MailE-Mail

FOM12-23

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

InformInformEmployeesEmployees

Written PolicyWritten Policy

Monitor forMonitor forBusiness ReasonsBusiness Reasons

Control and Control and EthicsEthics

FOM12-24

Robbins et al., Fundamentals of Management, 3rd Canadian Edition. ©2002 Pearson Education Canada, Inc., Toronto, Ontario.

Off-the-Job BehaviourOff-the-Job Behaviour

FOM12-25